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Impatience, Anticipatory Feelings and Uncertainty: A Dynamic Experiment on Time Preferences

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  • M. Casari
  • D. Dragone

Abstract

We study intertemporal choices through an experiment that elicits a subject's plan and then tracks its implementation over time. There are two main results. When facing a costly task to be completed under a deadline, two thirds of subjects prefer anticipating it rather than postponing it. Choice reversals are common although present-biased preferences alone cannot explain them. This evidence is compatible with models based on anticipatory feelings and stochastic utility.

Suggested Citation

  • M. Casari & D. Dragone, 2011. "Impatience, Anticipatory Feelings and Uncertainty: A Dynamic Experiment on Time Preferences," Working Papers wp777, Dipartimento Scienze Economiche, Universita' di Bologna.
  • Handle: RePEc:bol:bodewp:wp777
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    References listed on IDEAS

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    1. Marco Casari, 2009. "Pre-commitment and flexibility in a time decision experiment," Journal of Risk and Uncertainty, Springer, vol. 38(2), pages 117-141, April.
    2. Robin Cubitt & Daniel Read, 2007. "Can intertemporal choice experiments elicit time preferences for consumption?," Experimental Economics, Springer;Economic Science Association, vol. 10(4), pages 369-389, December.
    3. Pender, John L., 1996. "Discount rates and credit markets: Theory and evidence from rural india," Journal of Development Economics, Elsevier, vol. 50(2), pages 257-296, August.
    4. R. H. Strotz, 1955. "Myopia and Inconsistency in Dynamic Utility Maximization," Review of Economic Studies, Oxford University Press, vol. 23(3), pages 165-180.
    5. Casari, Marco & Dragone, Davide, 2011. "On negative time preferences," Economics Letters, Elsevier, vol. 111(1), pages 37-39, April.
    6. Yoram Halevy, 2008. "Strotz Meets Allais: Diminishing Impatience and the Certainty Effect," American Economic Review, American Economic Association, vol. 98(3), pages 1145-1162, June.
    7. Reuben, Ernesto & Sapienza, Paola & Zingales, Luigi, 2010. "Time discounting for primary and monetary rewards," Economics Letters, Elsevier, vol. 106(2), pages 125-127, February.
    8. Schelling, Thomas C, 1978. "Egonomics, or the Art of Self-Management," American Economic Review, American Economic Association, vol. 68(2), pages 290-294, May.
    9. Marco Casari & Davide Dragone, 2010. "Impatience, Anticipatory Feelings and Uncertainty: A Dynamic Experiment on Time Preferences," Jena Economic Research Papers 2010-087, Friedrich-Schiller-University Jena.
    10. Alexander L. Brown & Zhikang Eric Chua & Colin F. Camerer, 2009. "Learning and Visceral Temptation in Dynamic Saving Experiments," The Quarterly Journal of Economics, Oxford University Press, vol. 124(1), pages 197-231.
    11. Maribeth Coller & Melonie Williams, 1999. "Eliciting Individual Discount Rates," Experimental Economics, Springer;Economic Science Association, vol. 2(2), pages 107-127, December.
    12. Tomomi Tanaka & Colin F. Camerer & Quang Nguyen, 2010. "Risk and Time Preferences: Linking Experimental and Household Survey Data from Vietnam," American Economic Review, American Economic Association, vol. 100(1), pages 557-571, March.
    13. Azfar, Omar, 1999. "Rationalizing hyperbolic discounting," Journal of Economic Behavior & Organization, Elsevier, vol. 38(2), pages 245-252, February.
    14. repec:ubc:pmicro:halevy-04-10-29-10-08-43 is not listed on IDEAS
    15. David Laibson, 1997. "Golden Eggs and Hyperbolic Discounting," The Quarterly Journal of Economics, Oxford University Press, vol. 112(2), pages 443-478.
    16. Stefano DellaVigna & Ulrike Malmendier, 2006. "Paying Not to Go to the Gym," American Economic Review, American Economic Association, vol. 96(3), pages 694-719, June.
    17. Saul Pleeter & John T. Warner, 2001. "The Personal Discount Rate: Evidence from Military Downsizing Programs," American Economic Review, American Economic Association, vol. 91(1), pages 33-53, March.
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    Cited by:

    1. Marco Casari & Davide Dragone, 2010. "Impatience, Anticipatory Feelings and Uncertainty: A Dynamic Experiment on Time Preferences," Jena Economic Research Papers 2010-087, Friedrich-Schiller-University Jena.
    2. Marco Casari & Davide Dragone, 2015. "Choice reversal without temptation: A dynamic experiment on time preferences," Journal of Risk and Uncertainty, Springer, vol. 50(2), pages 119-140, April.

    More about this item

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
    • D90 - Microeconomics - - Micro-Based Behavioral Economics - - - General

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